Oil prices fell on Wednesday, weighed down by a stronger US dollar and weak data from major oil importer China, fueling demand fears.
Brent crude for August delivery fell $1.11 to $72.60 a barrel. US crude oil (WTI) fell $1.37, or 2%, to settle at $68.09.
At session lows, both benchmark contracts were down more than $2 to multi-week lows. Both fell more than 4% on Tuesday.
Oil prices fell after Chinese data showed manufacturing activity contracted more-than-expected in May as weakening demand lowered the official manufacturing purchasing managers’ index (PMI) to 48.8 from 49.2 in April, below the forecast of 49.4.
The dollar index, which measures the performance of the US currency against a basket of six currencies, was buoyed by cooling European inflation and progress on a bipartisan US debt ceiling bill, which it will advance in the House of Deputies for debate.
With House approval, the bill will move to the Senate, where debate could extend into the weekend as the June 5 deadline approaches.
A stronger dollar makes oil more expensive for buyers who hold other currencies.
Source: Terra
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